NUMBER 2: Need electricity to operate the stacks of hardware and keep them cool.

A big issue with bitcoin mining is Return on Investment. The major issue with the ROI of bitcoin mining is not only in the hardware itself, it is because you have to keep these computers running at all times and this leads to increases in energy bills. With margin profits small to begin with, often the increase in electricity cost often offsets any profit that one may get while mining bitcoins.

You could set the rig in a state here you can get the best rate of USD/kWh. This could make a small difference. So instead of setting up your rig in california at 15 cents per kWh you can set up your rig in another state where it more around 10 cents. Or you can set up a rig internationally somewhere like Indonesia where electricity only costs three cents per kilowatt hour. Another way to reduce costs is by installing PV or solar thermal systems that can provide some of the energy. However this does require an additional investment.